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Plastic Bag Ban Mars Sales, Employment

Boost for L.A. retailers outside of ban region: NCPA

August 15, 2012, 08:00 pm

A ban on the use of plastic bags in grocery stores and other retailers can negatively impact sales within the ban region and boost sales for stores outside of the ban region, according to a new study from the Dallas, Texas-based National Center for Policy Analysis (NCPA). “These findings suggest that bag bans may displace commerce and have real economic effects,” said NCPA senior fellow, Pamela Villarreal.

The NCPA’s survey comprises responses from store managers in Los Angeles County whose stores were within the region where a ban on thin-film plastic bags took effect in July, 2011. The results determined that over a one-year period before and after the ban, stores that fell within the ban experienced a 10 percent reduction in employment, while employment in stores outside the ban slightly increased. Additionally, the majority of stores surveyed with a ban reported an overall average decline in sales of nearly 6 percent. In contrast, the majority of those without a ban reported an overall average sales growth of 9 percent.

“Unfortunately, in Los Angeles County and other jurisdictions that have imposed bans or punitive taxes on bags have not considered unintended consequences,” added Villarreal. “The environment benefits of banning plastic bags are dubious enough, but the potential hardship created for businesses has been all but ignored.”

The ban applied to grocers and other retailers that sell at least some groceries and pharmacy items, and only those in unincorporated parts of L.A. County; incorporated regions were not subject to the ban. Stores located within a 2-mile radius in incorporated L.A. County were used for comparison for sales and employment growth. Villarreal told Progressive Grocer that the sales dip for stores subject to the ban is likely due to consumers taking their business to incorporated parts of the county.